Having $100,000 invested was once the gateway to building real wealth. For young people today, it’s double that.

Six figures is “an awesome accomplishment for any American,” but compared to the 1990s, “it doesn’t feel the same,” CJ Stermetz, a financial planner and founder at EquityFTW, told MarketWatch. “You should celebrate, for sure, but don’t stop doing the stuff that’s going to get you where you ultimately want to be.”

It’s a hard perspective to absorb when most young Americans don’t have $100,000 invested. In a new analysis of financial well-being by the Aspen Institute, having $120,000 in household net worth by your 30s is now the baseline for what it describes as “essential wealth,” or the wealth average households need to “experience resilience, prosperity and well-being.” Yet even when including any home equity, only 26% of households in their 30s have reached this threshold, in many cases because they lack liquid savings. 

Having $120,000, in other words, puts a household in their 30s — with typical income and expenses — on track for a comfortable retirement, not a lavish one. And while this Aspen Institute threshold includes home equity, researchers still noted that this wealth should not be too concentrated in housing. Many still aspire to be homeowners, but “owning a home, on its own, says little about a family’s broader financial picture,” they wrote, and having ample investable assets is necessary for security.

Read more: Here’s the net worth you need to start getting ahead in your 20s, 30s, 40s and beyond in the U.S.

For those entering the workforce, getting to a $100,000 baseline would require investing $500 each month for just over a decade with an 8% average annual rate of growth. For many, this is harder than it may seem.

As of 2022, median household financial assets (which includes retirement and brokerage accounts and other savings — but not houses) only cross into six-figure territory at retirement age, according to data from the Federal Reserve. This is partly the result of families traditionally building the bulk of their net worth in their primary residence instead. Still, even including home equity, median net worth peaked at $410,000 for households ages 65 to 74 — and many can’t afford basic living costs.

When most baby boomers were building their wealth, $100,000 was a significant benchmark relative to earnings at the time, and equal to several times the typical income. Research on financial well-being suggests for young Americans today, securing a sense of prosperity and independence requires reaching this six-figure milestone earlier in life, as time is so valuable in investing.

For Gen Zers, “having $100,000 invested is a big accomplishment,” Stermetz said. But “you’re still just starting your journey.”

Could $250,000 be the new $100,000 for younger Americans?

The $100,000 milestone was popularized by Berkshire Hathaway’s former Vice Chairman Charlie Munger, who said at a shareholder meeting in the 1990s, “The first $100,000 is a bitch, but you gotta do it… After that, you can ease off the gas a little bit.” 

Over the years, this memorable, round figure became a shorthand for a portfolio that could snowball into a large sum of money. It continues to be used as a key milestone by financial influencers today — you cannot, after all, reach $200,000 or $1 million in net worth without getting to $100,000 first. 

“You’re still just starting your journey.” — CJ Stermetz, financial planner and founder at EquityFTW

However, $100,000 has a different meaning now, as the goal posts have moved. The median household income in the late 1990s was close to $40,000, so $100,000 was equal to having 2.5 times the median income invested. By 2024, household income reached nearly $84,000; 2.5-times income meant having $210,000 invested. 

Looked at another way, adjusting $100,000 in the late 1990s for inflation also equals roughly $210,000 today. Or in reverse, $100,000 now has the value of about $50,000 in the late ’90s. 

Clifford Cornell, a financial planner at Bone Fide Wealth, told MarketWatch when his Gen Z clients cross the six-figure mark, it is often a “big psychological turning point” and “an inflection point in the client’s understanding that this really does work, that the money is finally starting to compound.” But they still have a long way to go before feeling compounding’s momentum, relative to their contributions from savings and their long-term goals.  

Hoping to “ease off the gas,” as Munger put it — for instance, by lowering your savings rate — with $100,000 invested may be premature in 2026. Most young workers who aspire to feel wealthy will need to continue investing a considerable share of their income for some time.

Broadly speaking, when people reach $250,000 invested, McKeon said, “You’re not to the point where you’re replacing your own income. However, as long as you don’t take from it, it’s going to continue to grow pretty well.” 

To reach $250,000, young households would need to invest $1,000 per month for about 13 years with an 8% average annual growth rate.

Crossing the $250,000 milestone is rarely discussed and remains rare for young workers. Excluding primary home equity, roughly 12% of those 30 to 34, and 22% of those 35 to 39, had $250,000 or more in wealth in 2023, according to a net-worth tool by the site DQYDJ using government data.

At an 8% average annual growth rate, this investment has the potential to grow over 30 years to $2.5 million without additional contributions, producing about $100,000 in annual retirement income using the 4% safe withdrawal rate outside of Social Security payments (However, new research suggests it may be safe to withdraw more than 4%).

Is this enough to set you on the path to feeling rich? Today’s households ages 65 and older spend an average $61,000 per year. But if average annual inflation is 3%, in three decades, when today’s 30-year-olds will be approaching retirement, that increases to $148,000 in typical annual spending. Cornell believes there will still be “some form of Social Security” at that point to supplement their income, despite major challenges with the Social Security program, but it is unlikely a household with that level of wealth will feel rich.  

Related: Social Security is on track to pay only 78% of benefits starting in 2032 if Congress doesn’t act

While many young workers will keep investing, this $250,000 threshold is when they may feel they “can really start to relax a little bit,” McKeon said. It will take more yet for most people to feel powerful momentum toward financial independence. 

A $500,000 investing milestone for middle-aged workers

“In my experience, clients tend to feel a greater sense of relief once they’ve crossed the $500,000 threshold,” Sara Young, a financial planner and founder of Live and Give Financial, told MarketWatch. 

More from MarketWatch: Here’s what it means to be rich in this economy — from your 20s to your 80s

Households in their 30s rarely have this much; the few who do could see it compound to $5 million over 30 years (creating $200,000 in safe annual withdrawals at 4%). 

By investing $2,000 per month, a young household can reach $500,000 in just under 13 years at an 8% average annual growth rate. For households who are not able to contribute this much, this milestone requires more time. Investing $1,000 per month can get to $500,000 in about 19 years.

Excluding home equity, about 15% of those 40 to 44 and 21% of those 45 to 49 had $500,000 or more invested, according to the DQYDJ tool. Without additional contributions, this investment has the potential to grow over 20 years to $2.3 million at an 8% average annual growth rate, producing $92,000 in annual retirement income at a 4% withdrawal rate. 

For these households, today’s $61,000 average annual retirement-age spending could inflate to $110,000 over the next two decades, when they reach retirement age.

Investors should remember that “every little bit helps. Keep saving, and one day you will notice the momentum is behind you,” Young said.

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